Gold Poised for a Bounce: Rick Rule

After gold plummeted below $1,600 per ounce to hit a six-month low Wednesday, its fundamentals remained strong, Rick Rule of Sprott Asset Management said.

"I think the technical are scary, but the fundamentals are pretty good. What you find in gold bull markets is retrenchments are fairly frequent, and this is nothing particularly unusual," he said.

On CNBC's "Fast Money," Rule noted that recent declines in gold have sent the precious metal lower by as much as 10 to 15 percent, after which prices rebounded.

"It's worth noting, of course, that the fundamentals are excellent," he added. "Gold is denominated in U.S. dollars, and the government seems to be doing their best to depreciate the denominator."

Rule said that the long-term outlook for gold remained, brushing off the latest drop in gold prices that put the commodity near its "death cross."

(Read More: Gold's 'Death Cross' Isn't All Investors Are Worried About)

A "death cross" occurs when an asset's 50-day moving average drops below its 200-day moving average, signaling the start of a bear market.

"Corrections are normal and healthy in a bull market," Rule said.

Trader disclosure: On Feb. 20, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Mike Murphy is long FB; Mike Murphy is long TOL; Enis Taner is long GS; Enis Taner is long TSLA CALL CALENDAR; Enis Taner is long QCOM PUT SPREAD; Enis Taner is long C PUT SPREAD; Enis Taner is long SPY PUTS; Pete Najarian is long AAPL; Pete Najarian is long BAC CALLS; Pete Najarian is long JPM CALLS; Pete Najarian is long MS CALLS; Pete Najarian is long YHOO; Pete Najarian is long BBRY; Pete Najarian is long SBUX; Pete Najarian is long FB; ;Pete Najarian is long MSFT; Pete Najarian is long PFE; Pete Najarian is long MRK; Pete Najarian is long MRK CALLS; Pete Najarian is long GSK CALLS; Pete Najarian is long JOY CALLS; Joe Terranova is long VRTS; Joe Terranova is long SJM; Joe Terranova is long MJN; Joe Terranova is long AXP; Joe Terranova is long JPM; Joe Terranova is long DIS; Joe Terranova is long FB; Joe Terranova is long BRKb; Joe Terranova is long GS; Joe Terranova is long SWN; Joe Terranova is long XOM; Joe Terranova is short EMINI S&P Futures March.